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GETECH Group plc (GTC)

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Tuesday 01 April, 2014

GETECH Group plc

Half Yearly Report

RNS Number : 6573D
GETECH Group plc
01 April 2014
 



 

Getech Group plc

("Getech" or the "Group" or the "Company")

Interim Report for the six months ended 31 January 2014

Getech, the geoscience services business specialising in the provision of data, studies and services to the oil, gas and mining exploration sectors, announces its interim results for the six months ended 31 January 2014.

Highlights

Revenue for the six months of £3,110,000 (six months ended 31 January 2013: £3,967,000)

Profit before tax of £233,000 (six months ended 31 January 2013: £1,398,000)

Interim dividend proposed 0.44p per share (2013: 0.4p per share)

Cash levels strong with gross cash of £4,103,000 (including Other financial assets)

Strong demand for consultancy work through the half year

Inertia in the market led to slow down in major sales

Evidence that the market is strengthening as from early 2014

 

Stuart Paton, Non-Executive Chairman of Getech Group plc, said:

"We start the second half of our year with strong cash balances and a substantial pipeline of sales opportunities. More importantly, the feedback from meetings early in 2014 suggests that not only do clients remain interested in our major products, but they now have budget available to spend. The oil price has been, and is currently, above the corresponding prices last year and we do not see signs of it weakening. As such, we are optimistic that the trading performance in the first half represented a short term market-related issue and we remain confident about our medium and longerterm prospects."

 

GETECH Group plc

Raymond Wolfson, Chief Executive

 

Tel:  0113 322 2200

WH Ireland Limited

Katy Mitchell

Tel:  0161 832 2174

 

 

Walbrook PR

Helen Cresswell

Tel:  020 7933 8790

Mob: 07841 917 679

[email protected]

 

 

 

 

Chairman's statement

Results

Getech reports a Group profit before tax of £233,000 (six months ended 31 January 2013: £1,398,000) after interest receivable of £16,000 (six months ended 31 January 2013: £6,000) on revenue of £3,110,000 (six months ended 31 January 2013: £3,967,000). The post-tax profit was £193,000 (six months ended 31 January 2013: £1,060,000).

The accounts have been prepared under IFRS in issue as adopted by the European Union.

Dividend

Your Board recommends an interim dividend of 0.44p per share.

Business review

Highlights:

·    

major sale from our gravity and magnetic datasets: $864k gross income;

·    

Globe continues to be positively viewed by the current sponsors;

·    

 

demand for consultancy services remains strong, with increasing evidence of the value of our work at basin and block scales; and

·    

pipeline of sales opportunities highly encouraging.

 

During the half-year the business has been affected by what appear to be general restrictions on spending by our clients, who are in large part the major exploration and production ("E&P") companies. The performance of E&P companies has been weak during this period, for which several reasons have been put forward, including increased costs, expectation of lower oil prices and a lower exploration success rate. Likewise, the exploration services market has been negatively impacted which has led to a number of the major seismic consultancies showing large falls in revenue and profit and significant share price falls. These observations notwithstanding, our regular discussions with clients and the wider industry suggest that our products and services remain attractive and in demand.

By the end of the period the cash balance (including cash on deposit under "Other financial assets") amounted to £4.1m. The Company is hence still in a very strong financial position.

Outlook

We start the second half of our year with strong cash balances and a substantial pipeline of sales opportunities. More importantly, the feedback from meetings early in 2014 suggests that not only do clients remain interested in our major products, but they now have budget available to spend. The oil price has been, and is currently, above the corresponding prices last year and we do not see signs of it weakening. As such, we are optimistic that the trading performance in the first half represented a short term market-related issue.

During the second half year we anticipate additional sponsors will participate in Globe and, based on feedback from the current sponsors, we are confident that most will sign up for the next three year period, which will start in July 2014. In line with our existing plans, we aim to use Globe to build stronger relationships with an increasing group of clients with the aim of leveraging additional product sales and consultancy.

The plans for the second period of Globe include a more varied array of deliverables which can be provided to clients who are not currently Globe sponsors. This will substantially enhance our new product flow. Further, we will increase the resolution of the whole of Globe, adding more value to clients' smaller scale work and making it of more use outside the global new ventures teams. We have already seen the benefits of applying Globe to much smaller scale work, at basin scale and down to block level, particularly with small companies.

The consultancy side of the business has been growing and we anticipate that this will continue, with the aim of extending our portfolio of new contracts and having a range from a few days up to several man years per contract.

We remain confident about our medium and longerterm prospects.

Stuart Paton

Non-Executive Chairman

1 April 2014

 

 

Consolidated statement of comprehensive income

For the six months ended 31 January 2014

Six months

Six months

Year

ended

ended

ended

31 January

31 January

31 July

2014

2013

2013

Unaudited

Unaudited

Audited

Note

£'000

£'000

£'000

Revenue

 3,110

 3,967

 8,011

Cost of sales

(1,137)

(870)

(2,521)

Gross profit

 1,973

 3,097

 5,490

Administrative costs

(1,755)

(1,701)

(3,269)

Operating profit

 218

 1,396

 2,221

Finance income

 16

 6

 31

Finance costs

(1)

(4)

(6)

Profit before tax

 233

 1,398

 2,246

Income tax expense

 (40)

(338)

(611)

Profit for the period attributable to owners of the parent

 193

 1,060

 1,635

Other comprehensive income

Currency translation differences on translation of foreign operations

 (90)

(30)

(39)

Total comprehensive income for the year attributable to

 103

 1,030

 1,596

owners of the parent

Earnings per share

5

Basic earnings per share

0.64p

3.62p

5.57p

Diluted earnings per share

0.60p

3.28p

5.30p

 

 

 

 

Consolidated statement of financial position

As at 31 January 2014

Company registration number 2891368

31 January

31 January

31 July

2014

2013

2013

Unaudited

Unaudited

Audited

£'000

£'000

£'000

Assets

Non-current assets

Property, plant and equipment

2,713

2,626

2,753

Intangible assets

505

651

616

Deferred tax assets

123

299

129

3,341

3,576

3,498

Current assets

Inventories

301

402

166

Trade and other receivables

1,124

1,180

2,123

Other financial assets

500

-

500

Other current assets

118

40

139

Cash and cash equivalents

3,603

5,578

4,358

5,646

7,200

7,286

Total assets

8,987

10,776

 10,784

Liabilities

Current liabilities

Borrowings

-

262

119

Trade and other payables

 2,291

3,668

3,524

Current tax liabilities

53

487

109

2,344

4,417

3,752

Non-current liabilities

Trade and other payables

-

15

17

Deferred tax liabilities

88

57

110

88

72

127

Total liabilities

2,432

4,489

3,879

Net assets

6,555

6,287

6,905

Equity

Equity attributable to owners of the parent

Share capital

76

73

76

Share premium account

3,013

2,848

2,993

Share option reserve

115

189

123

Currency translation reserve

(126)

(27)

(36)

Retained earnings

3,477

3,204

3,749

Total equity

6,555

6,287

6,905

 

 

 

Consolidated statement of cash flows

For the six months ended 31 January 2014

Six months

Six months

Year

ended

ended

ended

31 January

31 January

31 July

2014

2013

2013

Unaudited

Unaudited

Audited

£'000

£'000

£'000

Cash flows from operating activities

Profit before tax

 233

 1,398

 2,246

Share-based payment charges

 10

-

 23

Depreciation and amortisation charges

 119

 104

 213

Finance income

(16)

(6)

 (31)

Finance costs

 1

 4

 6

Exchange adjustments

 28

(5)

 (77)

Increase in inventories

 (135)

(342)

(106)

Decrease in trade and other receivables

 1,000

 1,782

 840

(Decrease)/increase in trade and other payables

 (1,250)

 352

 209

Cash (used in)/generated from operations

(10)

 3,287

 3,323

Income taxes refunded

(102)

(324)

(851)

Net cash (used in)/generated from operating activities

(112)

 2,963

 2,472

Cash flows from investing activities

Purchase of property, plant and equipment

(14)

(24)

 (191)

Funds transferred into fixed term deposits

 -

 -

 (500)

Interest received

 16

 6

 31

Net cash generated from/(used in) investing activities

 2

(18)

(660)

Cash flows from financing activities

Proceeds from issue of share capital

 20

 7

 154

Repayment of long-term borrowings

(119)

(143)

(286)

Dividends paid

(483)

(234)

(351)

Interest paid

(1)

(4)

(6)

Net cash used in financing activities

(583)

(374)

(489)

Net (decrease)/increase in cash and cash equivalents

 (693)

 2,571

 1,323

Cash and cash equivalents at beginning of period

 4,358

 3,011

 3,011

Exchange adjustments to cash and cash equivalents

(62)

 (4)

 24

at beginning of period

Cash and cash equivalents at end of period

 3,603

 5,578

 4,358

 

 

 

Consolidated statement of changes in equity

For the six months ended 31 January 2014

Share

Share

Currency

 

Share

premium

option

translation

Retained

Total

capital

account

reserve

reserve

earnings

equity

£'000

£'000

£'000

£'000

£'000

£'000

At 1 August 2013 - audited

76

2,993

123

(36)

3,749

6,905

Issue of share capital under share-based

-

20

(18)

-

18

 20

payment options

Share-based payment charge

-

-

10

-

-

10

Dividends paid

-

-

-

-

(483)

(483)

Transactions with owners

-

20

(8)

-

(465)

(453)

Profit for the period

-

-

-

-

193

193

Other comprehensive income

Currency translation differences

-

-

-

(90)

-

(90)

Total comprehensive income for the period

-

-

-

(90)

193

103

At 31 January 2014 - unaudited

76

3,013

115

(126)

3,477

6,555

 

 

 

 

 

 

Notes to the interim report

For the six months ended 31 January 2014

1 Nature of operations

The principal activity of Getech Group plc ("the Company") and its subsidiary company, Geophysical Exploration Technology Inc. (collectively "Getech" or "the Group") is the provision of gravity and magnetic data, services and geological studies to the petroleum and mining industries to assist in their exploration activities.

2 General information

Getech Group plc is the Group's ultimate Parent Company. It is incorporated in England and Wales and domiciled in England (CRN: 2891368). The address of its registered office is Convention House, St Mary's Street, Leeds LS9 7DP. Its principal place of business is Kitson House, Elmete Hall, Elmete Lane, Leeds LS8 2LJ. The Company's shares are admitted to trading on the London Stock Exchange's AIM.

The financial information for the six months ended 31 January 2014 and 31 January 2013 has not been audited and does not constitute full financial statements within the meaning of Section 434 of the Companies Act 2006. These consolidated interim financial statements ("the interim financial statements") have been approved by the Board.

The financial information relating to the year ended 31 July 2013 is based on the Group's statutory accounts for that period. The statutory accounts were prepared in accordance with International Financial Reporting Standards (IFRS) in issue as adopted by the European Union. IFRS include interpretations issued by the International Financial Reporting Interpretations Committee (IFRIC). The statutory accounts received an unqualified audit report, did not contain statements under Sections 498(2) or (3) of the Companies Act 2006 and have been filed with the Registrar of Companies.

3 Basis of preparation

The interim financial statements are for the six months ended 31 January 2014. They have been prepared using the recognition and measurement principles of IFRS. The interim financial statements do not include all the information required for full annual financial statements and should be read in conjunction with the financial statements of the Group for the year ended 31 July 2013.

The interim financial statements have been prepared under the historical cost convention except in relation to financial instruments held at face value through profit or loss. They have been prepared in accordance with the accounting policies adopted in the last annual financial statements for the year ended 31 July 2013.

The accounting policies have been applied consistently throughout the Group for the purpose of preparation of the interim financial statements.

4 Dividends

Six months

Six months

Year

ended

ended

ended

31 January

31 January

31 July

2014

2013

2013

Unaudited

Unaudited

Audited

£'000

£'000

£'000

Paid during the period

At: 1.6p per share (2013: 0.8p per share, year ended 31 July 2013:

483

234

352

1.2p per share)

Proposed after the period end (not recognised as a liability)

At: 0.44p per share (2013: 0.4p per share, year ended

133

117

482

31 July 2013: 1.6p per share)

 

The proposed dividend is payable on 16 May 2014 to members on the register at 22 April 2014.

5 Earnings per share

Basic earnings per share is calculated on the basis of the profit for the period after tax, divided by the weighted average number of Ordinary Shares in issue in the period of 30,183,332(six months ended 31 January 2013: 29,266,455; year ended 31 July 2013: 29,323,481).

Diluted earnings per share is calculated on the basis of the profit for the period after tax, divided by the weighted average number of Ordinary Shares in issue plus the weighted average number of Ordinary Shares which would be issued if all options granted were exercised. The addition to the weighted average number of Ordinary Shares used in the calculation of diluted earnings per share for the six months ended 31 January 2014 is 1,820,077 (six months ended 31 January 2013: 3,099,028; year ended 31 July 2013: 1,494,138). At 31 January 2014 600,000 of options in issue were anti-dilutive because the conditions for exercise had not been met (31 January 2013: 600,000; 31 July 2013: 600,000).

6 Interim Report

This Interim Report is being sent to the shareholders of Getech and will be available at its registered office, Convention House, St Mary's Street, Leeds LS9 7DP, UK, and from its website, www.getech.com, from 15 April 2014.

 

 

 

 

 


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The company news service from the London Stock Exchange
 
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